Audit Fees of Non-profit Organizations: An Empirical Study on Private Colleges and Universities
| Autor: | Yung-Yu Lai, 賴永裕 |
|---|---|
| Rok vydání: | 2007 |
| Druh dokumentu: | 學位論文 ; thesis |
| Popis: | 95 This study collected first-hand audit fee data from audited financial statements of private colleges and universities for the 2001-2003 academic years. The empirical results support the first hypothesis (H1) that audit fees of NPOs would be higher when limited tendering procedures were carried out for auditor selections. As to the second hypothesis (H2), it is argued that auditors could reduce follow-up audit work to cut down audit costs since NPOs clients (private colleges and universities) pose a low audit risk with steady and strong financial structures. These results support our hypotheses H2a and H2b, that is, NPOs with lower business risk and better corporate governance are more likely to pay lower audit fees. The third hypothesis assumed that the more complicated the clients are, the more effort auditors would make to maintain a tolerable audit risk, one as low as possible. These results support our conjecture that an increase in relative audit fees is subject to an increase in the level of NPOs’ complexity. By excluding the industry specialist Big 4, a comparable result is found to be consistent with our forth hypothesis (H4a). It shows that the auditor brand name premium exists between the non-specialist Big 4 and the non-Big 4 while the non-specialist Big 4 is defined as audit firms having their audit fees in that industry of less than 15 percent. In sum, we could conclude that differences in audit fee charges may be attributed to fee premiums for the specialist Big 4, and so provide additional evidence to sustain the auditor’s brand name premiums and industry specialist effect. The main contributions of this research are not only to make a comprehensive understanding about the determinants of audit fees for NPOs, but also to empirically show both brand name premiums and the effects of industry specialists. |
| Databáze: | Networked Digital Library of Theses & Dissertations |
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